Russia’s growth prospects will depend on the strength of domestic policies and reforms. GDP growth in the past three years averaged 1.4% and is projected at a similar rate in 2019, according to a latest update from the International Monetary Fund (IMF). External support is expected to be limited, as sanctions, global political and trade uncertainty and lower oil prices have replaced the favorable external conditions that contributed to rapid growth in the 2000s boom. Thus Russia now needs to focus on domestic reforms to improve growth potential.

A key building block is the credible macroeconomic framework the authorities have established since 2014, in difficult circumstances, in the form of inflation targeting, exchange rate flexibility and the fiscal rule. These have helped weather external shocks and reduce uncertainty about the domestic environment. Improvements in financial sector soundness put banks in a better position to support growth. And the 2018 pension reform will help offset the negative demographic trend in labor markets.

Beyond these factors, stronger medium-term growth will require an acceleration of structural reforms to improve the working of the economy. The National Projects announced in 2018 have potential to reinvigorate activity, but only if they are implemented effectively and complemented with far-reaching efforts to strengthen competition, roll back the state and improve state-owned enterprise efficiency.

The fund further notes that Russia’s monetary policy has been successful in addressing potential shocks to price stability, and easing now appears appropriate. The monetary policy stance is estimated to be moderately tight. The VAT increase has had a lower-than-expected impact on headline inflation, and the recent slight appreciation of the ruble and stability of domestic fuel prices reduce inflationary pressures.

UK retail sales declined at the fastest pace since October 2017, quarterly Distributive Trades Survey from the Confederation of British Industry showed Friday. A balance of -27 percent reported a decline in sales volume in May. However, a 7 percent forecast a pick-up in volume. The survey showed that 42 were retailers, also showed that the volume of sales for the time of year were at their poorest since March 2009. The volume of orders placed on suppliers slumped in the year to May, with the balance at -41 percent.

Japan's all industry activity index declined 0.4 percent month-on-month in March, following a 0.2 percent drop in February, figures from the Ministry of Economy, Trade and Industry showed on Friday. Among components, construction industry activity increased 0.3 percent, slower than 1.5 percent rise in February. At the same time, industrial production declined 0.6 percent, reversing a 0.7 percent gain in February. Tertiary industry activity fell 0.4 percent, following a 0.6 percent decline in February. On a yearly basis, all industry activity dropped 0.4 percent in March, after a 0.3 percent increase in the previous month.

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Economic Buzz: New Zealand Posts NZ$433 Million Trade Surplus In April 24-May-2019 (09:22)

New Zealand merchandise trade surplus came in at NZ$433 million in April, Statistics New Zealand said on Friday, following the downwardly revised NZ$824 million surplus in March (originally NZ$922 million). Exports were up 12.0 percent on year to NZ$5.55 billion, down from the downwardly revised NZ$5.60 billion in the previous month (originally NZ$5.70 billion). Imports rose an annual 7.3 percent to NZ$5.11 billion, up from NZ$4.78 billion a month earlier.

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Economic Buzz: Japan Overall Consumer Prices Up 0.9% On Year In April 24-May-2019 (09:20)

Japan overall nationwide consumer prices were up 0.9 percent on year in April, the Ministry of Internal Affairs and Communications said on Friday, up from 0.5 percent in March. Core consumer prices, which exclude volatile food prices, also advanced an annual 0.9 percent, up from 0.8 percent. Individually, prices were up for food, housing, fuel, furniture, clothing, medical care and recreation; they were down for communications and transportation. On a monthly basis, overall inflation and core CPI both were up 0.1 percent.

US first-time claims for unemployment benefits unexpectedly edged lower in the week ended May 18th, according to a report released by the Labor Department on Thursday. The report said initial jobless claims dipped to 211,000, a decrease of 1,000 from the previous week's unrevised level of 212,000.

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Economic Buzz: US New Home Sales Plunge In April 24-May-2019 (08:51)

US Commerce Department said new home sales plunged by 6.9 percent to an annual rate of 673,000 in April after spiking by 8.1 percent to an upwardly revised rate of 723,000 in March. With the upward revision, the annual rate of new home sales in March was the highest since reaching 727,000 in October of 2007.

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Economic Buzz: German Private Sector Expands In May 23-May-2019 (15:12)

Germany's private sector expanded at a moderate pace in May, survey data from IHS Markit showed Thursday. The composite output index rose unexpectedly to a 3-month high 52.4 in May from 52.2 in April. A reading above 50 indicates expansion in the sector. Data showed that other indicators weakened, however, with new orders falling for the fourth time in five months and employment growth easing to its lowest in just over three years in April. On the price front, latest data showed a slowdown in the rates of both input cost and output charge inflation. The manufacturing PMI fell unexpectedly to 44.3 from 44.4 in April. The expected score was 44.8. At the same time, the services PMI dropped to a 4-month low of 55.0 from 55.7 in the previous month.

Euro area private sector expanded in May but the pace of growth remained subdued, survey data from IHS Markit showed Thursday. The composite output index rose marginally to 51.6 in May from 51.5 in April. The score was forecast to rise to 51.7. A score above 50 indicates expansion. However, the weak reading puts growth in the second quarter so far on a par with the lacklustre gain seen in the first quarter and was among the lowest recorded since mid-2013. The manufacturing Purchasing Managers' Index slid to 47.7 from 47.9 in April. The score was forecast to rise to 48.1. Likewise, the services PMI came in at 52.5 in May, down from 52.8 in the previous month. After rising to a modest five-month high in April, growth of new business waned again, data showed. Jobs growth slipped to the joint-lowest since 2016 as firms scaled back expansion plans in the light of weak sales. Optimism about the future meanwhile slumped to a four-and-a-half year low and inflationary pressures moderated as competition limited sellerspricing power.

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Economic Buzz: German Ifo Business Confidence Weakens In May 23-May-2019 (14:39)

Germany's business confidence index fell to 97.9 in May from 99.2 in April, survey results from the Ifo Institute showed Thursday. The Ifo business confidence weakened for a second straight month and at a faster-than-expected pace in May. The current assessment index eased sharply to 100.6 from a revised 103.4 in April. The expectations measure of the survey was steady at 95.3 in May, after April's score was revised from 95.2.

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Economic Buzz: German GDP Advances 0.4% In Q1 23-May-2019 (12:18)

Germany's gross domestic product advanced 0.4 percent sequentially in the first quarter, after staying flat in the fourth quarter and contracting 0.2 percent in the third quarter of 2018, detailed results from Destatis showed Thursday. The expenditure-side breakdown showed that private consumption advanced 1.2 percent, while government spending decreased 0.3 percent. Gross fixed capital formation growth improved to 1.1 percent from 0.8 percent. Exports and imports climbed 1 percent and 0.7 percent, respectively. On a yearly basis, GDP climbed working-day adjusted 0.7 percent, which was slightly faster than the 0.6 percent expansion seen in the fourth quarter. On an unadjusted basis, economic growth slowed to 0.6 percent from 0.9 percent a quarter ago. Both annual GDP rates came in line with preliminary estimate.

Australia's private sector activity expanded in May underpinned by both services and manufacturing sectors, survey data from IHS Markit showed on Thursday. The Commonwealth Bank of Australia flash composite output index rose to 52.2 in May from 50.0 in April. Any readings above 50.0 signal growth in the sector. Business activity rose for the first time in four months in May with pick-up in new order growth. New orders increased at the fastest pace since January. Business confidence improved for the second month and confidence in both the manufacturing and service sectors were higher. The services Purchasing Managers' Index, or PMI, rose to 52.3 in May from 50.1 a month ago. Likewise, the manufacturing PMI climbed to 51.1 in May from 50.9 in the prior month.

Japan manufacturing sector fell into contraction in May, posting a manufacturing PMI score of 49.6, the latest survey from Nikkei revealed on Thursday. That's down from 50.2 in April and it falls beneath the boom-or-bust line if 50 that separates expansion from contraction. Individually, output and new orders fell for the fifth straight month, while the business outlook reflected pessimism for the first time more than six years. New export orders, backlogs, stocks and quantities of purchases also were in contraction.

According to the minutes of the Federal Reserve's latest monetary policy meeting, members agreed that a patient approach to determining future adjustments to rates would likely remain appropriate for some time. Citing an environment of moderate U.S. economic growth and muted inflation pressures, the Fed expects to remain patient even if global economic and financial conditions continued to improve. The Fed decided to leave interest rates unchanged at the two-day meeting ended May 1st, as uncertainties affecting the U.S. and global economic outlooks had receded but inflation pressures remained muted. The minutes showed members agreed future interest rate adjustments would be based on realized and expected economic conditions relative to the Fed's maximum-employment and symmetric 2 percent inflation objectives. While the Fed noted a moderation in risks and uncertainties surrounding the economic outlook, such as trade negotiations, the meeting was held before the collapse of U.S.-China trade talks.

The US Federal Reserve is seemingly in no rush to alter the path of interest rates, according to the minutes of the central bank's latest monetary policy meeting. The minutes showed members agreed that a patient approach to determining future adjustments to rates would likely remain appropriate for some time. Citing an environment of moderate US economic growth and muted inflation pressures, the Fed expects to remain patient even if global economic and financial conditions continued to improve. The minutes showed members agreed future interest rate adjustments would be based on realized and expected economic conditions relative to the Fed's maximum-employment and symmetric 2% inflation objectives.

UK's public sector net borrowing or PSNB, excluding public sector banks was GBP 5.8 billion, which was 0.03 billion less than a year ago, preliminary data from the Office for National Statistics showed on Wednesday. Net borrowing was the lowest for April since 2007, the ONS said. In March, the borrowing showed a surplus of GBP 94 million.

UK consumer price inflation rose to 2.1 percent in April from 1.9 percent in March, figures from the Office for National Statistics revealed Wednesday. Nonetheless, this was slightly slower than the forecast of 2.2 percent. Month-on-month, consumer prices gained 0.6 percent versus expected rate of 0.7 percent. The consumer prices index including owner occupiers' housing costs advanced 2 percent annually versus 1.8 percent in March. At the same time, retail price inflation advanced to 3 percent from 2.4 percent a month ago. Another report from ONS showed that output price inflation slowed slightly to 2.1 percent in April from 2.2 percent in March. On a monthly basis, output prices climbed 0.3 percent following a 0.1 percent rise in the previous month.

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Economic Buzz: Australia Leading Index Slides In April 22-May-2019 (14:28)

Australia leading index dropped again April and remained consistently negative over the past five months, signaling that economic growth in the first quarter is likely be below trend, Westpac reported Wednesday. The Westpac- Melbourne Institute Leading Index declined to -0.47 percent in April from -0.13 percent in March.

Japan total value of core machine orders was up a seasonally adjusted 3.8 percent on month in March, the Cabinet Office said on Wednesday, coming in at 868.8 billion yen, following the 1.8 percent increase in February. On a yearly basis, core machine orders sank 0.7 percent following the 5.5 percent contraction in the previous month. The total value of machinery orders received by 280 manufacturers operating in Japan fell 4.3 percent on month and 1.0 percent on year in March.

Japan trade surplus came in at 60.402 billion yen in April, the Ministry of Finance said on Wednesday, down 90.3 percent on year and down from 528.5 billion yen in March. Exports sank 2.4 percent on year to 6.658 trillion yen, after sliding 2.4 percent in the previous month. Imports climbed an annual 6.4 percent to 6.598 trillion yen, up from 1.2 percent a month earlier.

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